The Washington Department of Revenue ("Department") recently released a new Excise Tax Advisory discussing sales to residents of other states.

Washington generally taxes sales of tangible personal property, digital goods, and digital code. However, sales may be exempt when made to non-residents of Washington. The exemption applies when the item sold will be used outside of Washington and when the purchaser's home location does not impose a sales tax of 3% or more. Sales of marijuana, motor vehicles and trailers, water craft, and farm machinery do not qualify for this exemption.

Sellers do not have to make use of this exemption. The exemption is only available at the time of purchase. If the seller collects sales tax, the purchaser cannot seek a refund from the Department.

If a seller chooses to make tax-exempt sales to non-residents, there are four requirements. First, the purchaser must live in a qualifying location. Only residents of Alaska, Colorado, Delaware, Montana, New Hampshire, Oregon, and American Samoa qualify for the exemption in the United States. Only residents of Alberta, Northwest Territories, Nunavut, and Yukon Territory qualify for the exemption in Canada. Second, the item sold must be used or consumed outside Washington. Third, the purchaser must establish non-residency with a valid driver's license, a corporate non-resident permit number, or a uniform Streamlined Sales and Use Tax Agreement exemption certificate. Fourth, the seller must keep a copy of the sales receipt and identifying information for five years.

TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.